WHERE ARE OFFICE TENANTS MOVING?
Written by: Michelle Fude, CCIM
Michelle Fude specializes in office leasing and tenant representation. Michelle delivers constant communication to clients through activity reporting on all current deal activity and provides daily creative solutions and proactive marketing plans specific to each property. Keep reading to get Michelle’s take on tenant-related trends in the office market.
The top four largest leases this quarter were signed at new developments (Grandview Crossing and Arlington Gateway). Does this surprise you? Are you still seeing high demand for office space in projects like this, despite the higher asking prices?
This is certainly one trend we’re seeing in recent Leases signed. Many Tenants are now focusing on how they use their physical office space as a place that their employees want to come work and collaborate with their coworkers, and a tool that can help them recruit and retain employees. Most companies have now figured out how to work in a remote so the purpose of office space in general seems to be shifting towards how companies can be most efficient and use their space to boost their culture and loyalty with employees.
Some people are saying that downtown will suffer long-term due to COVID, however, the CBD was the second hottest submarket this quarter in tenant migration. Have you seen consistent demand and activity in the CBD this year so far? Do you think we’ll see a shift from the CBD to the suburbs, or vice versa?
Downtown will always have its place for specific office users. Due to the physical congestion of the Downtown environment, many companies seem to still be working mostly remote or entering a hybrid program which gives the perception that the physical occupancy is low in the Downtown area. However, many Downtown Tenants I believe will stay focused in the area due to the centralized location, accessibility to the universities, walkable amenities, major venues and event centers and the new construction and improvements. For example the new lower.com stadium, the Scioto Peninsula development underway as well as Gravity II, those are just a few projects that are actively under construction that will further improve the leasability of the Downtown area.
What do you think Columbus can expect in terms of tenant activity trends throughout the rest of 2021?
I think there will be pent up demand that will begin to come to light in the next 3-6 months. We have conversations with Tenants daily that are working to further understand how they’re going to use their office space and it’s a matter of timing. Once companies are comfortable with a permanent return to the office plan, I think their office space discussions will be a top priority. Further if you look around the City and see the positive signs of continued construction and new developments you’ll see the City has a positive force behind it and is continuing to develop and more forward. Developments such as Grandview Crossing, Worth Avenue at Easton, Bridge Park of Dublin, Gravity II, Scioto Peninsula and more, are continuing to transform the city and secure new leasing. That’s a great indicator for the office Tenant community.
For more information on office Tenants in Columbus, check out our Q2 Tenant Migration Report.